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Federal Budget 2011

Federal Budget 2011: Implications for Small Businesses

Publish date: 11/05/2011

Implications for small businesses:

  • Complex Entrepreneurs Tax Offset replaced by instant tax write-off of first $5000 of any motor vehicle purchased from 2012/13
  • Budget forecasts for consumer and residential construction activity imply a difficult environment for small business
  • Temporarily reduce Pay As You Go instalments in 2011-12 to improve cash flow
  • Early reduction from 2012/13, in company tax rate to 29%

Broadly positive for business. The extension of the asset write-off to motor vehicles is supportive of investment, particularly for small businesses seeking to upgrade their vehicles in order to adapt to rising petrol prices.  The early cut to the company tax rate for small businesses has been affirmed, which will help support investment and cash flow, and jobs.

The boost to skills will help ease pressures as the labour market tightens.  But how successful the training measures are depends on how effective businesses are at taking and retaining employees who are in the process of building skills. 

Important information
As this advice has been prepared without considering your objectives, financial situation or needs, you should, before acting on the advice, consider its appropriateness to your circumstances.